updated 04:55 pm EST, Fri March 6, 2009

B&R to open e-book store

Barnes & Noble has recently purchased Fictionwise for $15.7 million, a retailer of electronic books, says a Friday Wall Street Journalreport, and will launch a new e-book store later this year. William Lynch Jr., president and CEO of Barnes & Noble, said the retailer bought Fictionwise because it has "one of the most popular applications on the iPhone, and they really understand merchandising," among other reasons.Fictionwise was the first e-book retailer to offer third-party e-books supported by Amazon's Kindle reader back in 2007.

While e-book sales are a small percentage compared to real book sales, they are increasing. Fictionwise, which launched in June of 2000 and is estimated to have sold 5 million e-books, will operate as an independent subsidiary of Barnes & Noble. Barnes & Noble was one of the first companies to offer e-books, with Dean Koontz's The Book of Counted Sorrows back in 2001, before stopping e-book sales late in 2003 due to a lack of public interest.

Fictionwise co-founder Stephen Pendergrast estimates total e-book sales in the US amounted to $100 million in 2008, adding others believe the market is larger. E-books are offered at a huge discount compared to their physical counterparts, as a best-selling novel is priced at $10 compared to $25 or more.

Amazon recently announced it would make its Kindle e-books also available for iPhones and iPod touch devices and other makers, including Sony and BeBook, are releasing dedicated e-book readers of their own.